Health Care Challenge Glossary: Legalese Explained

By AMY BINGHAM and Z. BYRON WOLF

March 23, 2012

ABCNEWS.com

The Supreme Court's three-day marathon of health care hearings begins Monday, and while the case affects every American, the arguments themselves are likely to be riddled with legalese and complicated jargon.

Don't expect to hear anyone refer to "Obamacare," the disdainful term many Republicans use to refer to the law. In the court chambers, it will be called the Patient Protection and Affordable Care Act.

From the "individual mandate" to the law's "severability," here are the terms you need to know to keep abreast on what will arguably be the most-watched Supreme Court decision in a generation.

Individual Mandate

The individual mandate, or "minimum coverage provision," is at the heart of the controversy over the Affordable Care Act. The provision requires most Americans to buy health insurance starting in 2014 or face a penalty. And the question is whether the government can require almost every American to buy health insurance or face a penalty. Those arguments are scheduled for Tuesday.

Republican attorneys general for 26 states, four individuals and a business group are suing the administration and arguing that the federal government cannot force its citizens to buy a product.

The government argues that the law isn't about buying a product, but regulating a means to pay for a product that every individual will need sometime in his life. It says the mandate is a necessary component of a broader scheme to regulate interstate commerce.

The individual mandate has been deemed unconstitutional by one lower appellate court and upheld by two. A third court in Richmond dismissed a challenge on jurisdictional grounds.

Commerce Clause

Article 1, Section 8, Clause 3 of the Constitution is more commonly known as the Commerce Clause. It gives Congress the power "to regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes."

Supporters of the law cite a landmark 1942 decision—Wickard v. Filburn-- that defines the scope of federal power to regulate interstate commerce. In the case the court found that Congress had the authority to regulate a farmer's wheat production even though it wasn't being sold on the open market. Justice Robert H. Jackson wrote that even though the farmer, Roscoe Filburn's , activity was local, and "though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce."

But opponents of the health care law distinguish it from the Wickard case saying that in Wickard, the farmer was already in the marketplace. They say that Congress may have the power to regulate interstate commerce, but it does not have the power to force an individual into the market place.

Whether the court cites the commerce clause as justifying the individual mandate, it could also point to the "Necessary and Proper" clause.

That section of the Constitution comes later in Article One and states, "The Congress shall have Power - To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof."

The Obama administration argues that the mandate is a valid means to carry out Congress' power to regulate interstate commerce. In court papers lawyers for the Obama administration write, "It is necessary to effectuate Congress's comprehensive reforms of the insurance market, and is itself and economic regulation of the timing and method of financing the purchase of health care services."

Opponents to the law argue that Congress has gone too far. In court papers they write, " The power to compel a person to enter into an unwanted commercial relationship is not some modest step necessary and proper to perfect Congress' authority to regulate existing commercial intercourse."

The 10th Amendment

The final piece of the Bill of Rights, which was enacted at the same time as the Constitution, the 10 Amendment clarifies that all laws not specifically given to the federal government should go to the states. It reads: "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."

Tension between the states and the federal government is at the heart of the case against the health care law.

The states argue that the power the federal government is claiming regarding the individual mandate is not compatible with the Constitution. They say that the Constitution is meant to protect and promote individual liberty and that the individual mandate is a threat to that liberty. Lawyers for the states argue that compelling an individual into a marketplace is a "revolution in the relationship between the central government and the governed."

Severability

If the Supreme Court strikes down the individual mandate, the most likely of the provisions being challenged to be deemed unconstitutional, the question arises whether the entire 976-page law will go down with it.
Or, the court could rule that the individual mandate alone is unconstitutional and the rest of the law stands. The law contains many provisions that are unrelated to the mandate.

Opponents to the law say that if the individual mandate is unconstitutional, then every other provision of the health care law must fall as well.

"Once you've ripped the heart and the lung out of the body, it doesn't matter that the fingers continue to actually move," said Michael Carvin, a lawyer representing the National Federation of Independent Business and the four individuals.

The Obama administration claims that if the individual mandate goes, it could take two popular provisions along with it: the requirement that insurance companies cover patients with pre-existing conditions and that they not raise premiums for chronically ill patients.

The government claims that if people are forced to buy insurance, they'll avoid it until they get sick, making the pool of insured people more unhealthy, thereby more expensive, which would drive up costs.

Anti-Injunction Act and Tax or Fine

The first argument the Supreme Court will hear, starting Monday, deals with whether it is constitutional for courts to even hear cases against the individual mandate provision of the Affordable Care Act. The law was passed in 2009, but all of its provisions – the requirement to buy health insurance and a ban on insurance companies rejecting people with preexisting conditions, among others – don't go into effect in 2014.

A 19th century law, the Anti-Injunction Act, aims to prevent the courts from interfering with the government's ability to collect taxes by barring the courts from ruling on tax laws until after they go into effect. There is some question as to whether the penalty imposed by the law for not buying health insurance is a tax or a fine.

If the Court finds that the Anti-Injunction Act applies to the individual mandate, then it would have to dismiss any challenges until April 15, 2015 when the first penalties for not having insurance would be collected.

While neither the administration nor the challengers believe the act should be in play, an appellate court in Virginia dismissed a challenge to the mandate citing the Anti-Injunction Act. Thus, the Supreme Court has dedicated an hour of arguments to the question of tax versus fine.

Medicaid Expansion

The Affordable Care Act vastly expands the number of Americans who qualify for Medicaid, the government insurance program for low-income people.

More than half the states -- 26 -- contest that this sweeping expansion puts an undue burden on state governments and thus are suing the federal government to prevent the reforms from taking effect.

Medicaid -- health insurance for the poor -- is broken into state-based programs, but the federal government puts up a good chunk of the funding and therefore requires what state Medicaid programs must cover.

As the law now stands, states will be required to cover all residents under the age of 65 (those that don't qualify for Medicare, the government insurance program for the elderly) who earn up 133 percent of the poverty level, or about $30,000 for a family of four.

About 16 million more Americans will get health insurance under these Medicaid changes when the law goes into effect, the Congressional Budget Office estimates, almost all of which will be paid for by the federal government, at least at first. By 2017, states will pick up 5 percent of the tab for the expansion and by 2020 the federal government will pass on 10 percent of the costs.

Congress made the new terms a condition of continued participation in Medicaid. Opponents of the law say the government is forcing the states to participate, because no state could reasonably expect to withdraw from the program. "The ACA threatens States with the loss of every penny of federal funding under the single largest grant-in-aid program in existence—literally billions of dollars each year—if they do not capitulate to Congress' steep new demands," lawyers for the states argue in court papers.

Conservative Bloc

Of the nine Supreme Court justices, four were appointed by Democratic presidents and five where appointed by Republicans. Most of this latter group is considered the conservative bloc with Justice Anthony Kennedy, although he was appointed by a Republican, generally considered the swing vote on the court.

In order for the Affordable Care Act to be upheld, either Kennedy or one of the four more conservative justices will have to vote with the four more liberal justices.

Liberals have their eyes on Chief Justice John Roberts and Justice Antonin Scalia. While both Roberts and Scalia are generally quite conservative, they have both joined their Democratic-appointed colleagues to rule in favor of expanding the federal government's authority in past cases.

It is not the official name nor is it the most politically correct, but the term "Obamacare" has cemented itself into the vernacular of the country's health care debate.

The word was originally coined by Republicans as a derogatory way to reference President Obama's health care law, officially titled the Patient Protection and Affordable Care Act.

"It's not affordable in the first place," Rep. Steve King, R-Iowa, told ABC news last year. "It's $2.6 trillion in spending over the first 10 years, so that doesn't work. I don't know what else to call it."

"I think as children read this in their history books, they will read Obamacare," King continued. "It's in the vernacular. In fact, it's in my spell check."

Democrats consider the term offensive. Democratic National Committee Chairwoman Rep. Debbie Wasserman Shultz took to the House floor to chide Republicans for using the word, which she said was "disparaging."

"By the way, I have no problem with folks saying Obama cares. I do care," Obama said. "If the other side wants to be the folks that don't care, that's fine with me."

Affordable Care Act

Despite what Urban Dictionary might tell you, the official name of Obama's health care reform is Patient Protection and Affordable Care Act, or the Affordable Care Act for short.

Here are a few of the main provisions in the thousand-page bill that Obama signed exactly two years ago. Many of these policies do not go into effect until 2014.

Requires that most Americans have health insurance by 2014 or pay a fine

Requires employers with 50 or more employees to offer health insurance to their workers or pay a $2,000 fine per worker

Creates a government-run marketplace where people can compare and buy private insurance plans

Expands Medicaid to cover families at 133 percent of the poverty line, or about $30,000 for a family of four

Decreases the out-of-pocket costs of prescription drugs for seniors by 50 percent

Eliminates co-pays for preventive care such as cancer screenings and mammograms

Allows young people to stay on their parents insurance until age 26

Bars insurance companies from dropping or denying coverage to patients with pre-existing conditions or those who get sick

Adds a 10 percent tax using indoor tanning beds at salons

Adds a 3.8 percent "Medicare Tax" to families earning more than $250,000 per year

Adds a tax on "Cadillac" insurance plans that are valued above the national average

Pre-Existing Condition

From diabetes to obesity, chronic or "pre-existing" medical conditions used to make buying health insurance nearly impossible and wildly unaffordable. The Affordable Care Act bars insurance companies from denying coverage or raising premiums for people who have such pre-existing conditions.

In theory, the steep cost of covering chronic diseases would be offset by every American paying into insurance pools because of the individual mandate, thereby spreading the cost around.

If the individual mandate is struck down by the Supreme Court, the administration argues that coverage of pre-existing conditions would have to go as well, because covering these patients would then overburden insurance companies.

The implementation of the pre-existing condition provision has been gradual. Initially, only children with such illnesses had to be covered and a "high-risk" insurance pool was created to cover adults with pre-existing conditions. When the individual mandate kicks in in 2014 so too will the requirement that all patients with pre-existing conditions be covered.